"We could have the current account balance remaining broadly where it is"
- Jeremy Lawson, senior U.S. economist at BNP Paribas
The U.S. current account deficit shrank to its narrowest in nearly two years in the third quarter of 2012, due to the weak domestic demand and lower oil prices, which curbed imports. The nation's current-account balance fell 9% to $107.5 billion, from a $118.1 billion shortfall in the prior quarter, the Commerce Department said Tuesday. If the amount the world's biggest economy owes to the rest of the world is falling falls around 3% of country's GDP each quarter, the net U.S. foreign debt should stabilize at manageable levels in the long-term period. In the third quarter, the current-account deficit fell to 2.7% of U.S. GDP, compared to 3% in the prior quarter.
"We could have the current account balance remaining broadly where it is," Jeremy Lawson, senior U.S. economist at BNP Paribas in New York, said before the report. "If growth in emerging markets picks up next year that would boost export performance. Similarly, faster growth in the U.S. would increase imports. It's hard to say how much of an improvement we could see."
"With imports falling further in October, look for the current account gap to decrease again in the fourth quarter," said Sal
© Dukascopy Bank SA